Payroll Question Pre Tax Health Insurance

[Bjorn]

Please assist with this question?
What amount do we claim as an expense on the schedule C for wages with this fact pattern?

Pay $1,000.00
Pre Tax Health Insurance $ 100.00
Ignore other deductions for now.

We want to claim an expense of wages of $1,000 on the schedule C but the W3 is going to show $900.00 on box 3 and 5. Is this going to cause problems with the IRS?

Mahalo,

Bjorn.

[AJsTax]

The total expense for wages is $1000. That the employee chooses to protect some of his income from taxes is not an issue. A payroll journal would show gross wages $1000., adjusted gross wages $900 and taxes figured from there.